Ariel Investments, an investment management company, released its “Ariel Appreciation Fund” first-quarter 2025 investor letter. A copy of the letter can be downloaded here. In the first quarter, investors fled to shelter as hopes for another year of U.S. outperformance, driven by economic momentum and the new administration’s pro-business approach swiftly gave way to tariff fears and policy uncertainty, causing most of the major U.S. indices to close the quarter in the red. Against this backdrop, the fund returned -6.94% in the first quarter underperforming the Russell Midcap Value Index’s -2.11% returns, and the Russell Midcap Index’s -3.40% returns. In addition, please check the fund’s top five holdings to know its best picks in 2025.
In its first-quarter 2025 investor letter, Ariel Appreciation Fund highlighted stocks such as Mattel, Inc. (NASDAQ:MAT). Mattel, Inc. (NASDAQ:MAT) is a toy and family entertainment company. The one-month return of Mattel, Inc. (NASDAQ:MAT) was -25.96%, and its shares lost 18.38% of their value over the last 52 weeks. On April 17, 2025, Mattel, Inc. (NASDAQ:MAT) stock closed at $14.83 per share with a market capitalization of $4.789 billion.
Ariel Appreciation Fund stated the following regarding Mattel, Inc. (NASDAQ:MAT) in its Q1 2025 investor letter:
“Several stocks in the portfolio delivered solid returns in the quarter. Toy manufacturer Mattel, Inc. (NASDAQ:MAT) advanced over the quarter, following strong earnings results highlighted by solid sales growth, margin expansion and robust free cash flow generation. Management also provided full year 2025 1The “Magnificent Seven” are the largest stocks in the S&P 500 Index driving market performance: Apple Inc. (AAPL), Amazon.com, Inc. (AMZN), Alphabet Inc. (GOOGL), Meta Platforms Inc. (META), Microsoft Corp. (MSFT), NVIDIA Corp. (NVDA) and Tesla, Inc. (TSLA). guidance ahead of Wall Street expectations. With buyback activity expected to accelerate and the company poised to grow market share in 2025, we believe shares remain undervalued at current levels. Attractive opportunities to exploit its intellectual property through future film and TV projects only heighten our conviction.”
A child with a wide smile playing with the latest interactive toy.
Mattel, Inc. (NASDAQ:MAT) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 30 hedge fund portfolios held Mattel, Inc. (NASDAQ:MAT) at the end of the fourth quarter which was 25 in the previous quarter. Mattel, Inc. (NASDAQ:MAT) reported net sales $1,646 million in the fourth quarter, an increase of 2% in reported or 3% in constant currency. While we acknowledge the potential of Mattel, Inc. (NASDAQ:MAT) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
In another article, we covered Mattel, Inc. (NASDAQ:MAT) and shared the list of top kid-friendly stocks to buy according to billionaires. In addition, please check out our hedge fund investor letters Q1 2025 page for more investor letters from hedge funds and other leading investors.
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Disclosure: None. This article is originally published at Insider Monkey.